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The convergence of the iterative identification algorithm for the Hammerstein system has been an open problem for a long time. In this paper, a detailed study is carried out and various convergence properties of the iterative algorithm are derived. It is shown that the iterative algorithm with normalization is convergent in general. Moreover, it is shown that convergence takes place in one step (two least squares iterations) for finite-impulse response Hammerstein models with i.i.d. inputs.